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This is after the Singapore govt announced a plan to help all employers pay about up to 8% of their wage bill for 1 year.
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Singapore Govt to bear 90% risk for SME Loans, Rates for key loan schemes slashed
It’s difficult to raise money, find funds, let alone loan money on main street. The Singapore government is putting the bandage where it hurts most, standing behind the SMEs, another great initiative:
The Singapore government will make it easier and cheaper for small and medium-sized enterprises (SMEs) to get access to credit to keep their business going.
It announced two enhancements to the government loan scheme for SMEs on Tuesday.
The government will pay 90 per cent of insurance premiums for loans made to SMEs, up from 50 per cent that was announced last month.
This will lower the loan insurance cost borne by companies.
The insurance premium currently stands at 1.5 per cent of the loan quantum. With the government paying 90 pre cent of the quantum, SMEs will only have to pay 0.15 per cent of the loan amount.
Interest rates for key business loan schemes, such as the micro and bridging loans as well as the local enterprise finance scheme, will also be cut by 1.25 percentage points to help businesses manage the cost of credit.
For loan tenures of four years or less, the interest rate will be fixed at five per cent, down from 6.25 per cent. For loans taken out for more than four years, the interest rate will be fixed at 5.5 per cent, down from 6.75 per cent.
The changes will take effect from January 1. The government announced these enhancements to further help local SMEs with their cash flow and cost of credit in the current economic slowdown.
It’s difficult to raise money, find funds, let alone loan money on main street. The Singapore government is putting the bandage where it hurts most, standing behind the SMEs, another great initiative:
The Singapore government will make it easier and cheaper for small and medium-sized enterprises (SMEs) to get access to credit to keep their business going.
It announced two enhancements to the government loan scheme for SMEs on Tuesday.
The government will pay 90 per cent of insurance premiums for loans made to SMEs, up from 50 per cent that was announced last month.
This will lower the loan insurance cost borne by companies.
The insurance premium currently stands at 1.5 per cent of the loan quantum. With the government paying 90 pre cent of the quantum, SMEs will only have to pay 0.15 per cent of the loan amount.
Interest rates for key business loan schemes, such as the micro and bridging loans as well as the local enterprise finance scheme, will also be cut by 1.25 percentage points to help businesses manage the cost of credit.
For loan tenures of four years or less, the interest rate will be fixed at five per cent, down from 6.25 per cent. For loans taken out for more than four years, the interest rate will be fixed at 5.5 per cent, down from 6.75 per cent.
The changes will take effect from January 1. The government announced these enhancements to further help local SMEs with their cash flow and cost of credit in the current economic slowdown.